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The Universities Superannuation Scheme, one of the UK's last and biggest final-salary pension plans, could be on the verge of cutting back its generous payouts - falling into line with other state schemes in the UK and Ireland as rising life expectancy and turbulent markets have taken their toll.

Sir Andrew Cubie, chairman of a review group looking at the future of the £27bn (€30bn) USS, has told university employers and unions that his committee is considering abandoning final-salary pensions in favour of ones based on "career average" pay.

The UK's civil service pension plan took this step in 2007, and the BBC, the state-owned broadcaster, did so the following year. In December, Ireland's government said in its budget that it will introduce a similar arrangement for public-sector staff in 2010.

Career-average pensions are more affordable for employers because workers' earnings tend to peak just before retirement, leading to big payouts.

A spokeswoman for USS stressed that Sir Andrew's committee has not yet made any final recommendations. She said: "The Joint Review Committee is working toward an agreed outcome in Spring 2010. Career average is one of the options being considered but it is not an inevitable outcome."

In his remarks, published recently at the USS' website, Sir Andrew said: "I would not want anyone to think that a career average outcome is inevitable, but it is under active consideration – although you will be aware that such arrangements come in very different forms in terms of their key parameters."

Career-average schemes have provided a politically-acceptable "escape route" for several public-sector pension funds, as the contrast grows between their guaranteed benefits and the money-purchase arrangements that are now standard in the private sector.

Nine out of ten defined-benefit schemes in the private-sector are now shut, according to research from the Association of Consulting Actuaries, published today. Many of those that survive - such as at drinks group Diageo - are based on career-average payments, rather than final salary.

Sir Andrew Cubie's USS review group is also considering other cost-saving measures as the scheme struggles to make good its funding shortfall. Its solvency level was last estimated at 74% in March 2009.

This will have changed since but is still likely to be underfunded, as mark-to-market measures of the scheme's liabilities will have increased at the same time as markets have risen.

Cubie said: "I anticipate that there will be discussions taking place in the near future in the Investment Committee and at the Board about the link between a shift in strategy and the cost of pension benefits."